Scheme gives battlers a home of their own

Bill HoffmanWhether taking on developers hell-bent on destroying the Coast’s natural appeal or a Prime Minister indifferent to the plight of the poor, Bill Hoffman has never been one to mince his words. Bill’s been a journalist for 32 years, 29 of those on the Coast. Love him or hate him, he'll get you blogging.

The federal government has launched a $623 million scheme to create up to 100,000 extra low-cost rental properties by 2012.

The scheme would allow a stream of rental accommodation with rents 20% below market rent.

Investors would be reimbursed $8000 per property let under the scheme with the target banks and superannuation funds.

It comes as Australian Property Monitors reports double digit rent growth in all capital cities with Perth the worst with a 25% increase in rents over the past 12 months.

A National Centre for Social and Economic Modeling has found that while pay packets have increased by 31% between 2001-2006, housing costs have gone up 60% in the same period.

Meanwhile, a Western Australian affordable housing scheme is giving thousands of low-paid families a chance to get into a home of their own.

Open to anyone with an income of less than $50,000 for singles, $70,000 for couples and $80,000 for families, it allows purchase of a 60% stake in an owner-occupied property with the WA government as a shared equity partner.

That means that a family with a combined household income of $60,000 is able to purchase 60% of a home valued at $375,000, borrowing $220,500 at the current rate of 8.99% per annum.

The shared equity scheme meets the affordability benchmark set in a recent BankWest report into the housing crisis facing workers in critical areas like education, emergency services and police in Queensland.

The report describes as affordable, a house which costs no more than five times these workers annual mean salary of around $55,000 which puts anything over $275,000 out of their reach.

In WA, the State Government had launched $1billion in initiatives.

These include $300 million for the First Start shared equity scheme; a $417 million investment over four years to continue the delivery of social and affordable housing programs with an extra1124 dwellings over four years; expansion of the Bond Assistance Loan Scheme; stamp duty reduction, fast-tracking of government approvals for residential sub-divisions and a further $238 million housing and land package.

Defending Queensland’s Affordable Housing Strategy, deputy premier Paul Lucas referred to the BankWest report saying it had found the three councils most unaffordable were the former Noosa, the former Maroochy and the former Caloundra shire councils.

“So you want to get in a situation where police, teachers and nurses are not able to afford to live in the community that you seek to represent,” Mr Lucas said in response to Member for Maroochydore Fiona Simpson’s questioning of whether the fast-tracking of greenfield sites was just a ham-fisted non-consultative way to accelerate growth.

“It might be one thing if that is the situation in Noosa, where people can afford to live in Maroochy or Caloundra, but when the entirety of the Sunshine Coast, according to articles that were waved around before in the Sunshine Coast Daily, is at risk of having an affordability problem then that is a significant issue.”

However Mr Lucas could provide no guarantee that the scheme would deliver housing that would meet the BankWest benchmark for key workers.

Industry observers have indicated that the fast-tracked areas which include prime central business district localities in Maroochydore would be unlikely to provide house and land packages to meet the BankWest definition.

“The Queensland Housing Affordability Strategy takes action over areas where the state does have influence, including land supply, assessment and planning times, and infrastructure charging and government charges,” Mr Lucas told the estimates hearing.

The Western Australian shared equity scheme participants can upgrade their stake from time to time as circumstances dictate by purchasing more equity from the government at agreed market rates with no stamp duty applicable within the first 10 years.

If a property is sold improvements funded by the owner are taken into account and given a financial value.

Borrowers can choose the suburb and land they want to purchase and then enter into a building contract with a registered builder.

“The Department of Housing and Works is a party to those contracts,’’ the government spokesperson said.

“Private land developers and builders are providing affordable house and land packages for under $375,000.”

The government has committed $300 million over three years for the shared equity component .

The loan component is in addition to that amount and is likely to add a further $750 million to the commitment.

More than $125 million has already been spent on the equity component assisting 1100 people into their own homes with demand picking up considerably in the past two months.

The scheme has yet to have a default on loan payments and the Western Australian government is adjusting income limits to improve accessibility.